PNB stock goes down 4% as probe widens in market

Summary

Upwards of 30 banks marked down the bills in light of PNB's LoUs. The misrepresentation, which has been going ahead since 2010 at the Brady House branch of the bank in Mumbai, became known in January after a representative who was moving over the LoUs resigned.

Press Release

PNBBSE – 4.48 % dropped about 4 for every penny in Friday’s exchange in the midst of reports that the RBI has guided the bank to pay the whole Rs 11,300 crore owed to counterparty banks in the asserted extortion including goldsmith Nirav Modi.

Following the declaration, the stock descended 3.77 for every penny to hit a low of Rs 123.50 on the BSE. The stock at this level has lost almost a fourth of its fairly estimated worth (23.7 for every penny) amid its three-day fall.

“The sum included is considerable (total gross presentation identifying with fake exchanges is USD 1.8 billion), yet all the more stressing is the stark procedure careless and rehashed occurrence of comparative fakes (Winsome Diamond, and so forth). PSU banks keep on grappling with powerless frameworks, bringing up issues on why the procedures are not unified, not at all like most private banks where bypassing CBS isn’t simple,” EdelweissBSE – 1.65 % Securities said in a note.

By paying different moneylenders, just the balancesheet of PNB will endure as far as misfortunes as others won’t need to make arrangements. Brokers expect that installments from PNB will be postponed and there should be some intercession from the fund service on this issue, an ET report recommended.

Upwards of 30 banks marked down the bills in light of PNB’s LoUs. The misrepresentation, which has been going ahead since 2010 at the Brady House branch of the bank in Mumbai, became known in January after a representative who was moving over the LoUs resigned.